South Korea Faces Semiconductor Crisis as Chip Makers Eye U.S.

According to the British "Financial Times" report, South Korean Science Minister Li Zonghao said in an interview that in the ever-increasing chip war, South Korea is facing greater challenges from Taiwan, China, the United States and other places, and the South Korean semiconductor industry is shrouded in a "sense of crisis".

Korean media BusinessKorea also recently reported that South Korea's six core industries are facing strong headwinds, and semiconductors are expected to experience negative growth. According to reports, South Korea's six core industries are semiconductors, electric vehicles, batteries, displays, steel and shipping.

According to the "Financial Times", South Korean officials and industry executives are worried that domestic chip makers, lured by policy subsidies and tax incentives, are eager to go to the United States to build semiconductor factories and abandon chip production facilities in South Korea. Compared with the United States, mainland China, and Taiwan, South Korean companies have relatively few tax incentives from the government, and lack of talent, so legislation is needed to solve the problem.

It is reported that South Korean President Yin Xiyue promised to expand support for the semiconductor industry, but there are currently two important pieces of legislation stuck in parliament. The authorities have increased tax breaks and cut red tape. They also intend to fund necessary infrastructure such as water and electricity supplies for chip factories. They also plan to build large semiconductor clusters and train 150,000 semiconductor talents over the next 10 years.

South Korea remains the world's largest producer of memory chips, with Samsung and SK Hynix accounting for 70 percent of global DRAM sales and more than half of the NAND flash memory market.